Industry Overview

INSURANCE INDUSTRY AT A GLANCE

The U.S. insurance industry’s net premiums written totaled $1.2 trillion in 2015, with premiums recorded by life/health (L/H) insurers accounting for 55 percent and premiums by property/casualty (P/C) insurers accounting for 45 percent, according to S&P Global Market Intelligence.

P/C insurance consists primarily of auto, home and commercial insurance. Net premiums written for the sector totaled $519.8 billion in 2015.

The L/H insurance sector consists primarily of annuities and life insurance. Net premiums written for the sector totaled $635.6 billion in 2015.

Health insurance is generally considered separate. The sector includes private health insurance companies as well as government programs. P/C and L/H insurers also write some health insurance.

There were 5,926 insurance companies in 2015 in the United States (including territories), including P/C (2,544), life/annuities (872), health (859), fraternal (85), title (56), risk retention groups (239) and other companies (1,261), according to the National Association of Insurance Commissioners.

Insurance carriers and related activities contributed $450.3 billion, or 2.6 percent, of U.S. gross domestic product in 2014, according to the U.S. Bureau of Economic Analysis.

The U.S. insurance industry employed 2.6 million people in 2016, according to the U.S. Department of Labor. Of those, 1.5 million worked for insurance companies, including life and health insurers (811,900 workers), P/C insurers (648,200 workers) and reinsurers (25,000 workers). The remaining 1.1 million people worked for insurance agencies, brokers and other insurance-related enterprises.

Total P/C cash and invested assets were $1.5 trillion in 2015, according to S&P Global Market Intelligence. L/H cash and invested assets totaled $3.7 trillion in 2015. The total of cash and invested assets for both sectors was $5.2 trillion. The majority of these assets were in bonds (62 percent of P/C assets and 74 percent of L/H assets).

P/C and L/H insurance companies paid $19.2 billion in premium taxes in 2015, or $60 for every person living in the United States, according to the U.S. Department of Commerce.

P/C insurers paid out $15.2 billion in property losses related to catastrophes in 2015, compared with $15.5 billion in 2014 according to the Property Claims Services division of Verisk Analytics. There were 39 catastrophes in 2015, compared with 31 in 2014.

A property/casualty insurer must maintain a certain level of surplus to underwrite risks. This financial cushion is known as “capacity.” When the industry is hit by high losses, such as a major hurricane, capacity is diminished. It can be restored by increases in net income, favorable investment returns, reinsuring more risk, and/or raising additional capital.

Property/Casualty Insurance Industry Income Analysis, 2011-2015 (1)

($ billions)

2011

2012

2013

2014

2015

Net premiums written

$438.0

$456.7

$477.0

$497.0

$514.0

Percent change

3.4%

4.3%

4.4%

4.2%

3.4%

Premiums earned

$434.4

$448.9

$467.4

$487.9

$505.8

Losses incurred

290.8

277.7

259.4

277.7

290.6

Loss adjustment expenses incurred

53.8

55.5

55.6

57.3

59.6

Other underwriting expenses

124.2

128.9

134.6

138.3

144.3

Policyholder dividends

1.9

2.1

2.5

2.4

2.5

Net underwriting gain/loss

-36.2

-15.4

15.2

12.2

8.7

Net investment income

49.2

48.0

47.3

46.4

47.2

Miscellaneous income/loss

2.5

2.4

1.5

-2.7

1.4

Operating income

15.4

35.0

64.1

55.9

57.3

Realized capital gain

7.0

6.2

11.4

10.3

9.4

Federal and foreign income tax

3.0

6.1

12.0

10.3

10.1

Net income after taxes

19.5

35.1

63.4

55.9

56.6

(1) Data in this chart exclude state funds and other residual market insurers and may not agree with similar data shown elsewhere from different sources.

(1) Before reinsurance transactions, includes state funds.
(2) Based on U.S. total, includes territories.
(3) Data for Farmers Insurance Group of Companies and Zurich Financial Group (which owns Farmers' management company) are reported separately by S&P Global Market Intelligence.

Top 10 Writers Of Life Insurance/Annuities By Direct Premiums Written, 2016

($000)

Rank

Group/company

Direct premiums written (1)

Market share (2)

1

MetLife Inc.

$95,110,802

15.2%

2

Prudential Financial Inc.

45,902,327

7.3

3

New York Life Insurance Group

30,922,462

4.9

4

Principal Financial Group Inc.

28,186,098

4.5

5

Massachusetts Mutual Life Insurance Co.

23,458,883

3.8

6

American International Group

22,463,202

3.6

7

Jackson National Life Group

22,132,278

3.5

8

AXA

21,920,627

3.5

9

AEGON

21,068,180

3.4

10

Lincoln National Corp.

19,441,555

3.1

(1) Includes life insurance, annuity considerations, deposit-type contract funds and other considerations; excludes accident and health insurance. Before reinsurance transactions.
(2) Based on U.S. total, includes territories.